Which Credit Card Should You Use At Hotels?

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I’m often asked by readers which credit card they should be using to maximize points for a given hotel stay.

Typically recommending which credit card is best for a particular bonus category (like dining) is easy. The added wrinkle with making this recommendation for hotel stays is that you don’t just have to consider which credit cards generally offers the best bonus categories for travel, but you also have to consider whether the hotel brand you’re staying at has a co-branded credit card that offers bonus points for stays at that specific brand.

In this post I wanted to look at the most rewarding credit cards for hotel spending in general (regardless of the brand you’re staying at), and then compare that to the bonuses offered by specific co-branded credit cards.

What are the most rewarding credit cards for hotel spending?

For this section I’m excluding co-branded hotel credit cards. That’s because I’m looking at the cards that offer the best bonuses on hotel spending in general, rather than the best bonuses for a particular brand of hotel.

So, which major credit cards offer bonuses for hotel spending?

1. Chase Sapphire Reserve® 

Reward for hotel spending: 5.1% (3x points, which I value at 1.7 cents each)
Card annual fee: $450

Learn more about this card here.

2. Ink Business Preferred℠ Credit Card

Reward for hotel spending: 5.1% (3x points, which I value at 1.7 cents each)
Card annual fee: $95
Things to be aware of: This is a business card, and the 3x points is limited to the first $150,000 in combined purchases in bonus categories each account anniversary year

Learn more about this card here.

3. Citi Premier℠ Card

Reward for hotel spending: 5.1% (3x points, which I value at 1.7 cents each)
Card annual fee: $95, waived the first year

Learn more about this card here.

4. Citi Prestige® Card

Reward for hotel spending: 5.1% (3x points, which I value at 1.7 cents each)
Card annual fee: $450

Learn more about this card here.

5. Chase Sapphire Preferred® Card

Reward for hotel spending: 3.4% (2x points, which I value at 1.7 cents each)
Card annual fee: $95

Learn more about this card here.


The Sapphire Reserve offers triple points on hotel spending

How do co-branded hotel cards compare?

As you can see above, there are four cards with the same return (by my valuation). All offer 3x transferrable points, and all are points that I value at 1.7 cents each.

That means you’re looking at a return of ~5.1% regardless of which card you use. Do you get a better or worse return when using a co-branded hotel credit card?

To be comprehensive, let’s look at the co-branded credit cards issued by Hilton Honors, IHG Rewards Club, Marriott Bonvoy, Radisson Rewards, and World of Hyatt. First let me share how much I value a point in each of these currencies:

  • Hilton Honors — 0.5 cents each
  • IHG Rewards Club — 0.5 cents each
  • Marriott Bonvoy — 0.7 cents each
  • Radisson Rewards — 0.3 cents each
  • World of Hyatt — 1.5 cents each

To keep things fairly simple, let’s look at the co-branded credit card from each of the hotel groups that offers the highest return on hotel spending:


I use the World of Hyatt Card for my Hyatt hotel spending

Crunching the numbers

Everyone will value points differently, and those with different points valuations may also come up with different conclusions.

Personally I think the Chase Sapphire Reserve®Ink Business Preferred℠ Credit CardCiti Premier℠ Card, and Citi Prestige® Card, offer the best general return on hotel spending, at 5.1%.

What’s largely surprising is that co-branded hotel credit cards don’t offer a better return for stays at their “own” hotels than these cards do for travel purchases.

Based on my valuation of hotel points:


Earn 14x points on Hilton stays with the Aspire Card

Now, I should mention that there are other potential considerations when deciding which hotel credit card to use:

  • The Citi Prestige fourth night free benefit is pretty awesome, and requires paying with that card, though this benefit is being adjusted as of September 2019
  • Amex Fine Hotels & Resorts offers extra perks for stays at certain hotels, and requires paying with an Amex Card; you can now even earn 5x points on these bookings when prepaying with The Platinum Card® from American Express
  • Often there are Amex Offers for discounts on hotel stays, which can make it worthwhile to use an Amex Card
  • Often hotel credit cards have spending bonuses that could make them worth using, even if it leads to a slightly lower return on the points you earn:
    • The World of Hyatt Credit Card offers a chance to earn two qualifying night credits towards your next tier status every time you spend $5,000 on your card plus a second free night certificate when you spend $15,000 on the card in a cardmember year
    • The Hilton Honors Ascend Card offers a Hilton weekend night reward when you spend $15,000 on the card in a calendar year

What’s your go-to card for hotel spending? Do you find it more worthwhile to use the hotel’s co-brand card, or do you use a card earning transferrable points?


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Comments

  1. Lucky,

    One thing that I think you and other bloggers miss out on is the value of using cobrand cards to “top off” points earned by regular activity.

    For example, spending on the Marriott cards doesn’t seem all that compelling based on your math. However, let’s say you are a business traveler that “naturally” earns 70,000 Marriott points a year through paid stays and you want to redeem points at a particular hotel that costs 80,000 a night (or two nights at a 40,000 hotel). Let’s say you also have to pay for $2,000 of Marriott travel on your own dime (many business travelers are not paying for flights directly). In that case, I would rather spend put that $2,000 of spend on a Marriott card and earn 12,000 Marriott points – that gets me to that 80,000 redemption instead of spending $2,000 on the Sapphire Reserve (which only earns 6,000 Marriott points due to Chase’s 1:1 transfer ratio). There are plenty of other non-hotel opportunities to earn 3x UR points with a Reserve, but there may be fewer opportunities to earn 6x Marriott points.

    Note this math doesn’t work as well with airlines given all airline cards earn at most 2x miles per dollar, which is below the Sapphire and Amex Cards.

  2. At check out, always apply only the minimum spend to activate your Amex offer, then put the balance on a card that earns multiples.

  3. @Anthony, in short, when you are short of Marriott points. That is all you need to say. With all the sign up bonus + double point promotion plus lack of good redemption opportunity most of times… I’m never in this situation.

    By the way, at least Alaska card give you 3 miles on their own booking.

  4. I use a cobranded card when possible, I had been leaving several points on the table when staying at non chain hotels. I could never remember which card to use so I would pull out my United card and get 1.5 points. Most recently I stayed at a hotel in Makati which was not a chain I normally use and pulled out my Citi Thank you card. After reading this I realize I should have used my Ink card, will be at another non chain hotel in a week, that is the card I will use.

  5. @Lucky sez: “Everyone will value points differently, and those with different points valuations may also come up with different conclusions.”

    So, let’s see how good your own assumptions are! I will calculate ‘rebates’ for paying with each CC rather than their ‘return” on spend and see how you measure up.

    ‘Rebates’ based on EARN rates require no assumptions and, thus, allow apples vs. apples comparisons. By contrast, with average REDEMPTION values of points peddled by self-anointed travel gurus ranging, e.g., between 0.5-1.0cpp for BONVoY, one might as well be doing apples vs. grapes comparisons!!!

    Points currencies actually cost a lot more to earn than to redeem. How much more? Let’s compute purchasing costs, determine the ‘rebates’ due to CC spend, and then compare these to “returns” on spend..

    BONVoY Top Elite
    Each BONVoY point costs:
    Without CC: 1/(17.5pts/$) * 100cents/$ = 5.71cpp
    With: 1/(23.5pts/$) * 100cents/$ = 4.25cpp
    — ‘Rebate’ due to CC: 1.46cpp or 25%

    HH Diamond
    Each HH point costs:
    Without CC: 1/(20pts/$) * 100cents/$ = 5.00cpp
    With CC: 1/(34pts/$) * 100cents/$ = 2.94cpp
    — ‘Rebate’ due to CC: 2.06cpp or 40%

    A WoH Globalist
    Each WoH point costs:
    Without CC:1/(6.5pts/$) * 100cents/$ = 15.38cpp
    With 1/(10.5pts/$) * 100cents/$ = 9.52cpp
    — ‘Rebate’ due to CC: 5.86cpp or ~37%

    The good news for you, @Lucky, is that in spite of the subjectivity of your valuations, your relative ranking of the “returns” on spend for at least BONVoY, HH and WoH tracks quite closely, magnitude-wise, with my OBJECTIVE ranking based on ‘rebates’. 🙂

    Your “return” on the BONVoY Boundless CC is 4.2%; my ‘rebate’ for the same card is 25%. The conversion factor (CF) between the ‘return’ and ‘rebate’ is 25/4.2 = 5.95;

    Let’s divide all the rebates by the CF of 5.95 and see how they compare with @Lucky’s “returns” on the spend

    — BONVoY Boundless CC: 25%/5.95 = 4.2% vs @Lucky’s 4.2% (no surprise there as it is the basis for the CF)

    — WoH Chase Visa: 37%/6.17 = 6.2% vs. @Lucky’s 6.0%

    — Aspire Card: 40%/5.95 = 6.7% vs. @Lucky’s 7.0%

    Not bad… 🙂

  6. For WoH above, the result is correct but one number, the CF, I typed in is not. It should be 5.95 and not 6.17.

    — WoH Chase Visa: 37%/””5.95″” = 6.2% vs. @Lucky’s 6.0%

  7. Don’t forget that IHG usually has a quarterly promotion where you have to complete several tasks of which paying for a stay on your IHG credit card is one. So, be sure to pay for at least one IHG stay quarterly along with other tasks to unlock 10s of thousands of bonus points.

  8. Lucky’s updated evaluation of Hilton points from 0.4 to 0.5 cpp changes the computation for those of us who have an Amex Hilton Ascend card rather than the Aspire card, At 0.4 cpp the Ascend bonus of 12X spend has a return of 4.8%. However boosting the value to 0.5 cpp increases the return to 6% better than the 5.1% return on my Chase Reserve card.

    I’ll need to remember to use the Ascend card as my default card domestically.

  9. @Tprophet. What Hyatt “devaluation”? I find no problem exceeding Lucky’s 1.5% valuation when applying points instead of paying $ member rate in the majority of bookings I am looking at. His valuation seems a more than fair to me. What ‘devaluation’ are you referring to?

  10. As for Hyatt, I had a real success utilizing points for my last vacation. I was traveling in Florida during Spring Break so most hotels were ridiculously expensive. We ended up staying in Orlando, Ft. Lauderdale, Miami and the Keys. Most stays were in excess of $300 a night with taxes and fees but had wide open points availability (reservations made before recent devaluation). All had breakfast in morning although I was getting sick of the Seattle’s Best Coffee…
    Hyatt House across from Universal Studios 8,000 $309.43 3.87
    Hyatt House across from Universal Studios 8,000 $309.43 3.87
    Hyatt House across from Universal Studios 8,000 $309.43 3.87
    Hyatt Place Fort Lauderdale – 17th Street 8,000 $284.74 3.75
    The Confidante Miami Beach 15,000 $534.66 3.56
    Hyatt Place Marathon/ Florida Keys 15,000 $381.54 2.54
    Hyatt Place Marathon/ Florida Keys 15,000 $381.54 2.54
    Hyatt Place Miami Airport-East 8,000 $162.33 2.03

    Spent a total of 85,000 points for $2,688.36 of hotel cost (with free breakfast) plus a points rebate of 11,500 due to the 1st quarter Hyatt promotion. So 73,500 points for $2,688.36 or roughly 3.66 cents per point. The ability to transfer from Chase UR points and the value I get is the primary reason I am giving up Bonvoy Platinum to become a Globalist.

  11. By the time I add in the value of premium card credits (Aspire & Brilliant) + free night stays (Ascend, WOH, Boundless) + extra card offers, I use co-brand cards over transferable currency cards at their respective properties.

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